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Prepaid card provider TransCard has partnered with Contractor Management Services to offer payroll cards. Contractor Management Service is the nationâs leading Third Party Administrator and will offer the benefits of prepaid cards to their independent contractor members. By implementing prepaid cards, CMS will eliminate the need for paper checks and distribute all payments electronically.

A new study has found that 82% of credit cards allow penalty interest rate hikes that could last indefinitely. The Pew Charitable Trusts’ “Safe Credit Cards Project” is calling on Congress to add a a “cure period” to curb penalty interest charges. The median allowable penalty rate was 28% about double the average non-penalty rate. Pew says Americans are on track to pay credit card penalty interest charges of more than $7 billion annually. The Senate bill contains a “cure period” that will ensure that cardholders have the opportunity to return to their original interest rate after six months of on-time payments. The Pew “Safe Credit Cards Project” studied all credit cards offered online by the largest 12 issuers and included more than 400 credit cards.

The gap between debit card and credit usage continues to widen in the USA. In the fourth quarter purchase dollar volume for credit cards was down 8% while PDV for debit cards was up 6%. Sequentially, the PDV for credit cards declined 5% while debit card PDV edged down by 1%. According to CardData, purchase dollar volume for Visa and MasterCard credit cards for the fourth quarter was $336 billion, compared to $354 billion in 3Q/08 and $365 billion one-year ago. Debit card PDV came in at $283 billion for 4Q/08 versus $286 billion in the third quarter and $266 billion for 4Q/07. For the full year Visa and MasterCard debit card gross dollar volume rose 11.6% to $1514 billion. While Visa will not release first quarter data until the third quarter, MasterCard reported that U.S. purchase dollar volume for credit cards in the first quarter was down 13.9% while debit card PDV rose 4.9%. For complete details on Visa and MasterCard performance visit CardData (www.carddata.com).

ABI’s NextGen Research forecasts global markets for financial kiosks and enhanced ATMs will grow at a compound annual rate of 9% and will include more than 186,000 financial kiosks and nearly 2.5 million ATMs by 2013. The report “Next Generation Financial Kiosks: No Bank, No Card, No Envelope Required” provides detail on the market and its outlook, including market drivers and inhibitors; detailed descriptions of self-service financial services applications and services; an examination of the regulatory and business challenges within this market and profiles of leading- and cutting-edge financial kiosk manufacturers and deployers. NextGen Research is the emerging technology arm of ABI Research.

A new contactless personalization platform has been introduced that enables financial institutions to instantly personalize mobile devices, fobs and contactless stickers at the branch level for NFC payments. CO-based Dynamic Card Solutions has unveiled the “CardWizard “Perso-to-Go” platform. Utilizing the DCS “Perso-to-Go” platform, branch personnel can personalize any contactless form factor — whether it is an embedded NFC chip on a mobile device or provided as a contactless sticker from manufacturers such as First Data’s “GO-Tag” solution or Oberthur Technologies’ “FlyBuy” sticker, that can be attached to a mobile phone, MP3 Player, PDA or key ring. No over-the-air personalization is required, and because “Perso-to-Go” also supports instant activation, the personalized device can be immediately used for contactless POS purchases. Current “CardWizard” customers can now upgrade their existing card issuance system to support “Perso-to-Go.”

Congress yesterday passed the “Credit Cardholders’ Bill of Rights Act of 2009” and it is on its way to President Obama for his signature by Memorial Day. The U.S. House voted 361 to 64 to send Obama the stronger Senate version of the legislation. The U.S. Senate voted 90 to 5 on Tuesday to pass “H.R. 627.” Once Obama signs the bill, it will take nine months to go into effect. Speaker Nancy Pelosi said the “Credit Cardholders’ Bill of Rights” is historic legislation that protects American consumers against sky-high interest rates, excessive fees and other unfair practices of some credit card companies. U.S. Senator Mary Landrieu (D-LA) says that unfortunately, the “Credit CARD Act” does not apply protections to small business owners who have fallen victim to predatory credit card practices. The California-based Consumer Education Foundation noted that the legislation will not protect consumers against outrageous interest rates or other egregious practices and represents an astounding victory for the banking and credit card industry. The CEF says that under the Senate bill: There is no cap on credit card interest rates; companies can raise interest rates on future purchases at any time; issuers can unilaterally changes the terms of the credit card contract; and can still use fine print “arbitration” clauses to prevent consumers from suing them in court. To view the complete bill visit CardFlash Online (www.cardflash.com). (CF Library 5/20/09)

A new white paper looks at security for mobile phone transactions. The paper, “Security of Proximity Mobile Payments,” focuses on a “collaboration model,” where financial institutions, MNOs, trusted third parties and other stakeholders in the mobile payments ecosystem cooperate in the management and deployment of mobile applications. The Smart Card Alliance white paper introduces the players, their roles, and their responsibilities in assuring the security of sensitive data. It explains how the payment application, consumer credentials, and consumer account information (such as a credit card number) are securely delivered to, loaded on, and stored in a mobile device. It also identifies risks present during the lifecycle of the payment information stored on the mobile device and suggests appropriate countermeasures. Participants involved in the development of the report included: Booz Allen Hamilton, Collis America, Cubic, Discover, Giesecke & Devrient, IBM, IfD Consulting, Infineon Technologies, Keypoint Consulting, MasterCard, VeriFone, Visa, and ViVOtech.

Digital card technology provider Serverside Group has received a patent for its core card customization architecture from the Indian Patent Office. The grant of the Indian patent, which follows the grant of a European Patent, not only enhances Serverside’s competitive position in India but indicates the likely outcome in other territories.

Transactions processed worldwide on the Visa and MasterCard networks during the first quarter grew at the slowest pace in the history of the payment card industry. Both networks had a year-on-year increase of only 6% in the number of transactions processed globally. The increase in the number of transactions processed has been generally declining since the start of the recession in the fourth quarter of 2007. MasterCard’s annual transaction growth rate was 19.4% in the first quarter of 2007, declining to 15.6% in the first quarter of 2008 and then collapsing to 5.8% in the first quarter of 2009. Visa’s annual transaction growth rate was 12% in the first quarter of 2007, rising to 15% in the first quarter of 2008 and then sliding to 6% in the first quarter of 2009. Visa processed 9.3 billion transactions in 1Q/09 for Visa, Visa Electron, Interlink and PLUS cards. MasterCard processed 5.1 billion transactions in the first quarter for MasterCard, Maestro and Cirrus cards. For complete details on Visa and MasterCard first quarter and prior performance visit CardData (www.carddata.com).

Payment processor LML Payment Systems has appointed David C. Cooke to the Board of Directors. Cooke served as the Executive Director of the newly-created Resolution Trust Corporation (“RTC”) from 1989 to 1992, where he was responsible for the RTC’s organization, staffing and operation. While with the RTC, Cooke oversaw the takeover of nearly 700 failing institutions and the development of innovative sales initiatives for managing and disposing of their assets. After leaving the RTC in 1992, Cooke spent eleven years as a senior-level consultant in the private sector, where he managed groups advising banks on emerging capital market developments and foreign governments and multi-lateral financial institutions on financial sector issues. In 2003, he was recruited by the FDIC to serve as its first Chief Learning Officer in charge of its new Corporate University. Cooke retired from the FDIC in 2006 and works part time as a consultant and teaches graduate level finance.

Aite Group releases a new report that examines mobile transaction initiatives. The impact report is based on quantitative and qualitative research of 69 mobile transaction initiatives internationally and explores the current range of services in development and the underlying technologies powering each initiative. Following an initial growth spurt at the turn of the century, developers are once again active in bringing mobile transaction services to market. The technological evolution of the mobile device and mobile networks,coupled with increased end-user savvy, has led to an increase in mobile transaction initiatives over the past five years. By understanding the various initiatives around the globe, and what failed and what succeeded, financial institutions and other players can better tailor their own solutions.

Growth in credit card debt moderated in March, dipping slightly by A$300 million. However, credit card volume remained robust, rising 9.3% over year ago figures to A$18.7 billion. Year-on-year credit card debt growth has slowed to 4.4%, compared to 4.8% in the prior month and 7.8% one-year ago. According to the Reserve Bank of Australia credit card balances hit A$44.4 billion in March versus A$42.5 billion one-year ago. The RBA also revised the figures for credit card balances for the past twelve months. Most of the revisions lowered previously reported figures by about A$600 million. Credit limits now stand at A$123.6 billion, compared to A$116.4 billion in March 2008. According to the Reserve Bank of Australia there are currently 14.2 million credit card and charge card accounts in Australia, compared to 13.8 million one-year ago.